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Tata Steel’s strong performance in the March 2017 quarter exceeded analysts’ expectations by a huge margin. Though such performance may not be repeated in the first half of the current fiscal given the falling commodity prices, it does improve earnings visibility.

The company reported Rs 6,982 crore in operating profit before depreciation (EBIDTA), a sequential increase of 91% and 51% higher than the consensus estimate. The sharp jump was on account of higher volumes, better product mix and higher cost efficiencies.

Tata Steel’s Indian operations, which contributed the most to profit, benefited from higher ferro alloy prices and increased exports. The delivery volume increased 7% over the previous quarter and the realisation per tonne increased by 19%.

With improved earnings, the company lowered its debt by Rs 4,300 crore sequentially to Rs 72,367 crore. The company’s net debt-EBIDTA ratio in FY17 improved to 4.3 from 10.8 in the previous fiscal. This can further improve as analysts expect 6-8% EBIDTA growth in the current fiscal.